Can an employer that honestly (but wrongly) believes that its employees are stealing, and reports that matter to the police be liable for wrongful prosecution? Apparently not, according to an opinion issued today by the Court of Special Appeals.
The elements of a wrongful prosecution claim are: (1) the defendant instituted or continued criminal proceedings against the plaintiff; (2) defendant lacked probable cause for the proceedings; (3) there was malice or a primary purpose in instituting the proceedings was other than that of bringing an offender to justice; and (4) the proceedings ended in a favorable result for the the plaintiff.
In Smithfield Packing Co. v. Eveley, the Court ruled that an employer "continued criminal proceedings against its employee" by failing to turn over exculpatory evidence to the police. That evidence was the employee's explanation that he did not steal the employer's property (two cases of ham), but held the property in his truck for a purely innocent reason. The Court found that by failing to turn over the employee's statement to the police, the employer "continued the prosecution."
In the same opinion, overturning a jury's verdict, the Court seems to be stating that the employer is insulated from liability because at the time it reported the employee to the police it honestly believed he was stealing. The Court did not address whether the employer continued to have probable cause after it learned the employee had a purely innocent explanation for putting the ham in his truck.